Just think, you’re putting your hard-earned tax in a black box, and then you see that it’s promoting hidden deals among big companies and leaders. This is the real case of electoral bond irregularities in India. For years, these bonds promised clean money for elections, but they hid a web of secret cash flows that spoiled democracy.
In 2014, the Delhi High Court ruled that BJP and Congress had broken the law by taking foreign cash. The case started with two companies linked to a British firm, Vedanta. Ignoring the ban on outside money, he gave lakhs of rupees to both the parties. This provoked anger, but instead of reforming, the government introduced electoral bonds in 2017. The leaders claimed that this will eliminate black money and bring transparency. Nevertheless, the leak revealed that the Reserve Bank of India (RBI) and the Election Commission had also warned against it. Donors from Bond could remain anonymous, making the elections a mysterious auction.
You vote for change, but what if hidden cash controls everything? Opaque donations mean companies buy advantages like easy licenses or ignored reds. This is not a matter of any one party – it is a loss for the country. Funds kept for roads and schools are spent in the campaign. Without clean sources, policies favor donors over you. For true democracy, it is important that voters know who is funding to contest elections, so that power remains with the people and not in the pockets of some people.
Early funding and industrial bearing after independence (1950 s)
Right after independence, the 1951 elections required a lot of money. Congress was at the forefront, and was taking money from big industrialists like Birla and Thakurdas. These industrialists saw benefits in supporting the winners, getting better deals on land and licenses. Small groups like Jan Sangh (which later became BJP) were running the business with very little money. Nusli Wadia, a donor from Bombay Dyeing, had given him some money. The money turned the tables early on, knocking out those underfunded.
First legal challenge and tax incentive
In 1957, a shareholder filed a case against Tata Iron and Steel over gifts secretly given to Congress. Court records show that Tata’s lawyers admitted that they had kept the party in power for business gain. This brought about close relationships. Soon, benefits were added to the Income Tax Act: a 100% discount on political gifts under sections 13A, 80GGB, and 80GGC. Temples get only 50%. Why? The parties argued that this was for the public good. Donors started paying money by hiding behind tax shields.
The Rise of Bane and Shadow Funding (1969-1985)
Indira Gandhi tightened up in 1969 and abolished Section 293 A of the Companies Act. Now corporate cash could not be received directly. But the tricks came out quickly. Companies used to pay for “adds” in party magazines which were never published, like Graphite India gave lakhs of rupees. The investigation found 180 companies involved, totaling in the hundreds of millions. To prevent foreign interference, the Foreign Exchange Regulation Act (FERA) of 1976 prohibited external funds for politics. The same rule applied to journalism and the courts. Nevertheless, the money continued to flow underground, avoiding every stop.
Cash economy and criminal connections in politics
The ban pushed the parties towards black cash. Who handled it best? Goons and miscreants, who were experts in gathering crowds and hiding notes. He promoted rallies, captured booths, and transferred funds. Not surprisingly, more than 40% of MPs are accused today. Just think: hooligans collect sacks of notes, then watch the leaders drive around in fancy cars. This cash trap took crime to the seats of power. Elections deviated from ideas and became loot of money.
Right to Know vs Right to Privacy: ADR Interference
In 2002, the NGO Association for Democratic Reforms (ADR) fought in the Supreme Court. He cited Article 19 (1) (A) – Your right to know. Voters have the right to know the truth about the crimes and property of the candidates. The Court agreed in 2003. Now, all the candidates have to give their property and case list. This made the faces clean, but there was no money behind them. Cash raids still remain in the headlines during elections.
Attempts to impose a limit on cash: ₹20 000 reduction of the limit
The 2003 change to the Representation of the People Act set a line: ₹over 20,000 gifts PAN and state with address. Smaller amount than that? No question. Parties loved it for rallies – people would give ₹10 or ₹100 without any paper. But fraudsters would divide large sums into pieces of ₹19,900. Mayawati’s ₹402 crore cash? All “inside the limit”, he said. Due to this, black money remained hidden in front of everyone. The auditor chosen by the parties approved everything.
Electoral Trust: Corporate Buffer Zone (since 1996)
Tata Group became smart in 1996. He created an electoral trust, collecting cash from firms without naming the parties. This protected the Donors from the feeling of revenge of the losing party. Shareholders saw only “trust” in the books – no details. Others also copied it and created secret pools. Initially there was no website, no rules. The government later gave tax exemption but kept it vague. Trusts were better than direct gifts, avoiding harassment and questions.
Motive behind Electoral Bonds (2017)
Finance Minister Arun Jaitley introduced bonds to eliminate black money. He asked that the limit for unannounced donations be reduced from ₹20 000 to ₹2 000. The bond will reveal clean cash. Parties need lakhs of rupees for posters, rallies and fuel – even honest parties. Without funds, only rich people can contest elections. Bond’s motive was to equalize it, or at least that’s what he claimed. But critics called it a cover to hide more secrets.
Method of Electoral Bond Scheme
Buy from Select SBI Branch – 29 places like Parliament Street in Delhi. Windows open in January, April, July, October: for 1-10 days. Are there elections? So 15-30 more days. If there is no SBI account fill in KYC: name, PAN, proof. Bonds come in sizes ranging from ₹1,000 to ₹1 crore, such as cash notes. Give it to a registered party (1% vote share in the last election). They can cash in with SBI in 15 days, or it will go to PM Relief Fund. There will be no tax on anyone. SBI knows everything, but shares nothing – it is run by the government, outside the scope of RTI.
Institutional objections to the Electoral Bond Framework
RBI expressed anger in 2017 letters: Bonds are like cash, stealing our printing power. This can lead to black market and laundering of black money. The Election Commission also agreed – unlimited gifts from companies give rise to shell firms. The Law Ministry questioned the 1% vote rule that was hurting smaller parties. Concerns persisted after the changes. Foreign enemies could enter and influence through foreign shell companies.
Main legal questions before the court
The Supreme Court considered two major questions in the petitions of ADR and Common Cause. First: Is concealing donor information a violation of the right to information under Article 19 (1) (a)? Second: Does Unlimited Corporate Cash, even from losers, eliminate fair elections under Article 14? The hearing lasted a long time, but the truth came out. Bond promised light but spread more darkness.
Verdict: Declaring the bond unconstitutional
On February 15, 2024, the Court struck it down. Bond failed the “least restrictive” test – why hide names when checks or UPIs work? Privacy protects honest donors, not bribe takers. Unlimited donations? Finished, back at 7.5% profit cap. SBI halts sale; EC releases data by March 21. Amendments to tax, company and election laws? All over. This was a victory for transparency.
Data dump: Ruling party’s funding advantage
The release clearly showed the inclination: the ruling party took over most, more than half. Bond too much the—₹ 92% in a pack of 1 million. Corporate was dominant, not common people. The opposition did not get anything special. This was similar to the old pattern: winners draw more cash. Was it a fair fight? Not at all.
Relationship between impressions and donations
Data exposed dirty connections. Take Future Gaming: printed in April 2022, same week ₹donated 1,300 crore. Profit? only ₹215 crore. Aurobindo Pharma: Investigations took place in November 2022, followed by gifts. DLF was under investigation by CBI for Vadra deal, gave ₹170 crores between 2019-2022— months later he got clean chit. Megha Engineering gave ₹100 crore in April 2023, next month it got tunnel project worth ₹14,400 crore. Seven Remdesivir companies did not pass COVID tests, received notices, then donated— cases are still going on.
Continuing issue: Impact of the policy on public interest
Big donors thrive on government approval: land, green light, contracts. Tobacco companies invest crores of rupees—will anti-cancer regulations be made? Or will you get favor first? The raids disappear after the gift. It’s a bicycle: cash buys the policy, the policy promotes cash. When secrets dominate, voters lose.
The Electoral Bond story uncovers a broken system. From the Industrial Cash of the 1950s to the Court’s decision of 2024, all parties want to be in the dark. Black money, foreign slips, raid bribes, all flourish without any restrictions. No one talks about giving complete information in their manifesto. Still, hope rests on you. Demand RTI on the fund, question candidates about the source. Insist for easy rules: full name, no bar to truth. rise above parties—fight for a country where votes, not safes, decide. Start now: Read the report, join the demands for reform. Your voice can break the silence.
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